Fannie Mae added: Through these actions we have demonstrated our continued dedication to providing quality care to all communities. And we remain firmly committed to continuing to provide such attention to our REO properties moving forward.

Reform of the government-sponsored enterprises and a potential for more non-agency lending will be a priority for the Trump administration, according to the presumptive nominee to head the Treasury Department. President-elect Donald Trump is likely to nominate Steve Mnuchin to lead the Treasury. Mnuchin is a former partner at Goldman Sachs, founded the hedge fund Dune Capital Management and was among the investors that purchased IndyMac in 2009. In an interview this week on ...

New loan limits for the government-sponsored enterprises in 2017 wont have much of an impact on jumbo originations, according to an analysis by Inside Nonconforming Markets. The Federal Housing Finance Agency announced last week that the baseline conforming loan limit for Fannie Mae and Freddie Mac will increase in 2017, which will also boost the GSEs high-cost loan limit. The baseline conforming loan limit will increase to $424,100 in 2017, up from the $417,000 level it has ...

Shortly after being nominated by President-elect Donald Trump to be his Treasury secretary, investment banker Steve Mnuchin midweek dropped a bombshell on the mortgage market: Ending the conservatorships of Fannie Mae and Freddie Mac would be a top priority. For the most part, the mortgage industry cheered the news, believing that at the very least, Mnuchin would preserve the federal guaranty on existing MBS and into the future. In fact, the market seems to be betting on it. But now comes...

New production of agency single-family MBS in November was down 8.2 percent from the previous month, according to a preliminary Inside MBS & ABS analysis. Fannie Mae, Freddie Mac and Ginnie Mae issued a combined $134.70 billion of single-family MBS in November, the lowest monthly total since July. A decline wasnt unexpected: the housing market is on the downslope of its seasonal trend and rising mortgage interest rates are taking some of the steam out of the refinance market. What is a little unusual is...[Includes two data tables]

The incoming administration of President-elect Donald Trump is likely a couple of months away from formal confirmation by the U.S. Senate of new cabinet officials. But at least one position has apparently been settled  that of Treasury secretary  and other names have been circulated, including that of a possible head of the Department of Housing and Urban Development. At the same time, Trump has begun fleshing out the personnel that will serve on various landing teams, which help ease the transitions at various federal agencies. On the cabinet level, the new president has decided...

The Federal Housing Finance Agency raised the maximum conforming loan limit for Fannie Mae and Freddie Mac mortgages in 2017 for the first time in a decade, but the impact on loan originations is questionable. Meanwhile, the FHA has not yet announced its 2017 loan limits. The baseline loan limit will go up for the first time since 2006, rising from $417,000 to $424,100. And the maximum high-cost loan limit for one-unit properties is climbing to $636,150, an increase of $10,650. The FHFA said that loan limits for the two government-sponsored enterprises will increase in all but 87 counties. An Inside Mortgage Finance analysis of Home Mortgage Disclosure Act data indicates...

Steven Mnuchin, President-elect Donald Trumps choice to be the next Treasury secretary, startled financial markets this week by indicating he would act quickly to bring Fannie Mae and Freddie Mac out of government conservatorship. Weve got to get Fannie and Freddie out of government ownership, Mnuchin said during an interview with Fox News. It makes no sense that these [two] are owned by the government and have been controlled by the government for as long as they have. In many cases, this displaces private lending in the mortgage markets, and we need these entities to be safe. Mnuchin, a former Goldman Sachs executive who bought the failed IndyMac Bank and resurrected it as OneWest, continued...

Lenders and servicers are likely to see some regulatory relief in the coming years though federal support for the housing market could also be reduced, according to officials at the Mortgage Bankers Association. The MBAs Mortgage Action Alliance recently hosted a call with MBA officials providing projections for how the Trump administration and Republican control of Congress will impact the mortgage industry. Things that were deemed impossible before the election are now in play, said Meghan Sullivan, the MBAs Senate Republican lobbyist. She said...

FHFA 2017 Multifamily Lending Caps Unchanged: The Federal Housing Finance Agency announced that the 2017 multifamily lending caps for Fannie Mae and Freddie Mac will remain at the same level they were for 2016. Each will be subject to a cap of $36.5 billion of multifamily purchase volume. The FHFA expects the multifamily finance market to be roughly the same as it was in 2016. Fannie Bans Plywood in Foreclosures. Fannie Mae recently banned the use of plywood to secure vacant homes. Beginning early this month Fannie property foreclosures must be secured by a plywood alternative, such as clear boarding.

With potential increases in loan production on the horizon, Freddie Mac introduced a pilot program aimed at getting more mortgage lenders prepared to originate manufactured housing loans and buyers prepared to purchase them. The GSE will partner with Next Step Network, a nonprofit specializing in manufactured home purchases, and eHome America, an online home counseling company, to implement the curriculum. One of the goals of the initiative is to foster new relationships with active participants in the manufactured housing industry. This includes national and local mortgage lenders.
Next Step is based in Kentucky, a state heavy in manufactured housing. Freddie said the partnership with Next Step will educate prospective buyers of...

The GSEs credit-risk sharing program has expanded over the years but not everyone has been fond of the transactions designed to transfer risk away from Fannie Mae and Freddie Mac Tim Howard, a former Fannie CFO, has become one of the programs biggest critics. He said todays credit-risk transfer program, mandated by the Federal Housing Finance Agency, removes the normal economic discipline of a company making its own decisions about which risks to keep and which ones to share, and on what terms. He said that the CRT transactions being done today are nothing like those done during his time at Fannie, before the start of the conservatorship.

The quality of the GSEs portfolios continues to improve as the credit quality of new single-family business remains strong and delinquencies are down, according to the Federal Housing Finance Agencys performance and accountability report for fiscal year 2016. But the agency said potential for a Treasury draw still looms. The report, released last week covers from October 2015 to September 2016 and highlights performance goals from the year. The average new single-family loan holds a weighted average credit score in the high 740s. Theres been a big improvement in delinquencies as loans that were seriously delinquent dropped considerably, down to 321,000. Thats a 25 percent decrease from a year earlier, when there were 426,000 seriously delinquent loans.

Fairholme Funds, the plaintiff in an ongoing GSE shareholder lawsuit, hosted a conference call late last week and dished on recent developments in the case. Fannie Mae and Freddie Mac are obligated to protect the capital of all preferred shareholders, not just one of those shareholders, the Obama Treasury, said Bruce Berkowitz, Fairholmes CEO. Plaintiffs in Fairholme Funds Inc. v. United States, et al, argue that the U.S. Treasurys net worth sweep of GSE profits is against the law. And, really, only those who oppose the dream of American homeownership would attempt to dismantle two publicly traded, shareholder-owned companies that have single-handedly provided $7 trillion in liquidity to support Americas mortgage market since 2009, he said.

The GSEs have sold more than 59,629 nonperforming loans through August 2016, according to the Federal Housing Finance Agencys second report this year highlighting the activity of nonperforming loan sales and borrower outcomes. That number is up from the 41,649 NPLs that were sold through May 2016. The report, released last week, is part of the FHFAs plans to make NPL sales data more transparent. The agency released its inaugural report in July and plans on publishing two each year. The latest report shows that the NPLs had a total unpaid principal balance of $11.9 billion, were delinquent 3.4 years on average and had an average current loan-to-value ratio of 97 percent.

House Financial Services Committee Chairman Rep. Jeb Hensarling, R-TX, called for greater accountability of the GSEs and discussed reintroducing his Dodd-Frank Act reform bill in the next Congress, during remarks in Washington last week. He said the GOPs PATH (Protecting American Taxpayers and Homeowners) Act would help end the Fannie Mae and Freddie Mac bailout. The PATH Act, first introduced in 2013, proposes to phase out the GSEs within five years. In addition to ending the costly bailout, Hensarling said the bill would protect and restore the FHA to its defined mission, increase mortgage competition, enhance transparency, maximize consumer choice, and break down barriers to private investment capital.

The U.S. Government Accountability Office found that the Federal Housing Finance Agencys strategic plan for the GSEs reflects a shift in priorities that has created more uncertainty. The GAO said the regulator revised the wording of the goals in the 2014 plan to align it more closely with FHFAs statutory responsibilities. In the absence of an official post-conservatorship plan for Fannie Mae and Freddie Mac, the GAO was asked to examine the FHFAs actions as conservator in a report highlighting the objectives needed for the future of the two companies after the conservatorship. The report noted that the FHFA increased its emphasis on maintaining credit availability and foreclosure prevention options, shifted away from...

The Federal Housing Finance Agency raised the maximum conforming loan limit for GSE mortgages by $7,100 for 2017, amid rising home values. The new loan limit, announced Nov. 23, is $424,100 and represents the first time in a decade, since the housing downturn, that the conforming loan limit climbed above $417,000. The baseline loan limit was established by the Housing and Economic Recovery Act and is recalibrated each year to reflect the changes in a national home price index. Until now, the index has not risen above levels set in the third quarter of 2007.

Fannie Mae and Freddie Mac saw a largely seasonal decline in single-family business in October, according to a new Inside The GSEs analysis of mortgage-backed securities data. The two GSEs guaranteed $99.33 billion of single-family MBS during October, an 8.3 percent decline from the previous month. Most of the slippage was in purchase-money mortgages, which fell 14.5 percent from September, following typical seasonal patterns. The refi market held up a lot better. October volume was down 1.6 percent from September, while still ranking as the second-highest monthly total so far this year. That pushed the refi business to 60.2 percent of GSE volume, excluding modified loans.

Bank mortgage repurchase activity rose again in the third quarter of 2016, although most of the increase is tied to Bank of America clearing up old buyback issues. Commercial banks and savings institutions reported $884.4 million in single-family mortgage repurchases and indemnifications during the third quarter. That was up 10.0 percent from the previous period and marked the third consecutive quarterly increase in repurchase activity ... [Includes one data chart]

Fairholme Funds officials this week continued to press their case for restoring shareholder rights for private investors in Fannie Mae and Freddie Mac, expressing hope that the incoming Trump administration will be friendlier to their cause. In Fairholme Funds Inc. v. United States, et al, the plaintiffs argue that the net worth sweep imposed by the Treasury Department and Federal Housing Finance Agency was illegal and that the two government-sponsored enterprises were not in a death spiral at the time of the bailout as the government claims. During a conference call this week, Fairholme CEO Bruce Berkowitz said...

The baseline conforming loan limit for Fannie Mae and Freddie Mac will climb to $424,100 in 2017, the first such increase since 2006. The 1.7 percent increase reflected a gain in the Federal Housing Finance Agencys expanded-data house price index at the end of the third quarter. The new ceiling for high-cost markets will...

President-elect Donald Trumps business background could help address two of the biggest challenges confronting the housing finance industry today: limited credit availability and a shortage in the supply of the housing stock, according to Laurie Goodman, director of the Urban Institutes Housing Finance Policy Center. Mortgage credit availability is an issue we have repeatedly written about, said Goodman in a recent online blog post. Some of her previous research has shown that the market is taking less than half the credit risk it was taking during 2001, a period of reasonable credit standards, she noted. And other HFPC research has shown...

The election of Donald Trump as the 45th president may open a path out of conservatorship for Fannie Mae and Freddie Mac, some investors in the two government-sponsored enterprises believe. According to interviews conducted with GSE investors, industry lobbyists, trade group officials and others, a recap and release plan backed by the junior preferred shareholders of Fannie and Freddie could formally be presented to the Trump administration early next year. There hasnt...

Fairholme Funds officials this week continued to press their case for restoring shareholder rights for private investors in Fannie Mae and Freddie Mac, expressing hope that the incoming Trump administration will be friendlier to their cause.

After much speculation, the Federal Housing Finance Agency raised the 2017 conforming loan limit for Fannie Mae and Freddie Mac mortgages to $424,100. This is the first time the loan limit climbed above $417,000 in 10 years.

The government-sponsored enterprises credit-risk transfer programs have been wildly popular with investors and many policymakers, but other industry observers see problems. One of the most outspoken critics is Tim Howard, a former Fannie Mae CFO, who sees a big difference between todays CRT programs and the GSEs traditional method of laying off credit risk before they were taken into government conservatorship. When I was at Fannie, the companies purchased...

Fannie Mae and Freddie Mac have sold more than 59,629 nonperforming loans with a total unpaid principal balance of $11.9 billion, through August 2016, according to a new Federal Housing Finance Agency report.

Fannie Names RPL Winner: Fannie Mae announced this week that Towd Point Master Funding (Ceberus) is the winning bidder for its first reperforming loan sale. The sale included approximately 3,500 loans totaling $789.2 million in unpaid principal balance, split into two pools. Towd won both pools and the transaction is expected to close on Dec. 15, 2016. In collaboration with Citigroup Global Markets Inc., Fannie began marketing these loans to potential bidders on Oct. 11, 2016. The RPL sale is part of its efforts to reduce the size of the GSEs balance sheet. Bob Ives, vice president of retained portfolio asset management, said, We are pleased to see a high level of investor interest in our reperforming loans.

The Federal Home Loan Bank System witnessed an increase in earnings for the third quarter, which rose to $861 million, and a year-to-date total of $2,478 million. The FHLBank Office of Finance noted that the quarterly net income increase was due to higher gains on litigation settlements, derivatives, hedging activities and higher net interest income. Additionally, the increase on year-to-date earnings was due to gains on trading securities, partially offset by losses on derivatives and hedging activities. Total assets for the FHLBanks grew to $1.036 trillion, an 8.7 percent increase from the second quarter. Advances represented $688.6 billion, which was driven mainly by higher member demand by larger members. That number is down slightly from the...

The Federal Housing Finance Agency determined that for 2015 Fannie Mae and Freddie Mac did not meet all of their low-income and very low-income home-purchase goals, according to the FHFAs preliminary annual housing report released in late October. Fannie met all of its goals in 2014 but this is the second year that Freddie fell short of meeting the same goals. Under the GSEs affordable housing goals, low-income is for home-purchase mortgages to families with incomes no greater than 80 percent of the area median income, and the very low-income home- purchase goal is for families with incomes no greater than 50 percent of AMI. The low-income home-purchase goal was 24 percent and Freddie ended 2015 at 22.3 percent.

Fannie Mae and Freddie Mac low-downpayment programs have been in the market for almost two years now but they havent been getting a lot of mileage. Although numbers picked up in the third quarter, some say the programs need to be simplified in order to promote more usage. The GSEs purchased $10.31 billion of purchase mortgages with loan-to-value ratios of 96 to 97 percent through Sept. 30, 2016, according to an Inside Mortgage Finance analysis of mortgage-backed securities data. However, nearly half of that came in the third quarter, which saw a 52.7 percent jump from the previous period. Fannies HomeReady program and Freddies Home Possible Advantage products were designed to help creditworthy, low- and moderate-income buyers.

All rights reserved. Photocopying or electronic distribution of this web page or any of its contents without prior written consent of the publisher violates U.S. copyright law, and is punishable by statutory damages of up to $150,000 per infringement, plus attorneys' fees (17 USC 504 et seq.) Without advance permission, illegal copying includes regular photocopying, faxing, excerpting, forwarding electronically, and sharing of online access.